Commercial Greenhouse Market

[322 Pages Report] According to MarketsandMarkets, the commercial greenhouse market is projected to reach USD 68.7 billion by 2028 from an estimated USD 39.6 billion in 2023, at a CAGR of 11.6% during the forecast period in terms of value. Several important factors augment the demand for commercial greenhouse solutions and services on a global scale. Commercial greenhouses provide the opportunity to lengthen growing seasons, lessen the effects of unfavorable weather, and ensure reliable crop harvests. Additionally, as consumer's awareness of the provenance and quality of their food grows, the transparency and traceability provided by greenhouse-grown products find a significant market resonance.

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Market Dynamics

Driver: Need for higher yields using limited space and water.

As the population expansion continues, available arable land becomes insufficient, making efficient land utilization a critical concern. Commercial greenhouses address this challenge by maximizing space utilization through vertical farming, hydroponic, and aeroponic systems, allowing for multiple layers of cultivation within a compact area. This spatial efficiency enables growers to achieve substantially higher crop yields compared to traditional open-field methods. Moreover, water scarcity is a compelling issue across many regions, necessitating the adoption of water-efficient cultivation techniques. Commercial greenhouses excel in this aspect by enabling precise control over irrigation, preventing water wastage through targeted delivery directly to plant roots. Additionally, advanced irrigation systems like drip and recirculation systems within greenhouses optimize water use and reduce evaporation losses. Thus, these factors are anticipated to drive the market of commercial greenhouses in the upcoming years.

Restraint: Deployment of expensive systems in commercial greenhouses

Commercial greenhouses are highly expensive owing to the use of several high-cost systems, such as HVAC systems, control systems, LED grow lights and sensors. Each LED grow light unit contains an array of LEDs specially designed for greenhouse applications, which increases their overall costs. These units contain different types of LED lights with variations in terms of wattage and wavelengths to provide the required light spectrum for the optimal growth of specific plant species.

It can be too expensive to make the initial investment needed to build up advanced infrastructure and equipment within greenhouses. Potential investors may be discouraged from entering the market by high expenses, especially smaller-scale farmers or those in emerging regions. This can restrict market growth and accessibility. Additionally, ongoing operational expenses associated with maintaining and running these advanced systems can be substantial. Energy-intensive climate control, lighting, and automation systems contribute to elevated utility bills. Thus, these factors could act as a restraint for market growth.

Opportunity: Rise in demand for floriculture and ornamental horticulture applications.

The increasing demand for floriculture and ornamental horticulture presents a significant opportunity for the commercial greenhouse market. As urbanization and disposable incomes rise across the globe, there is a growing interest in enhancing living and working spaces with aesthetically pleasing plants and flowers. Commercial greenhouses provide an ideal environment for cultivating a wide variety of flowers, plants, and ornamental foliage with precision and control.

Commercial greenhouses' capacity to provide ideal growing conditions independent of the climate outside is expected to benefit market growth. This makes it possible to grow flowers and decorative plants all year long, satisfying demand for these items during off-seasons or in areas with unfavorable weather. Additionally, greenhouses shield sensitive plants from harsh weather, pests, and illnesses, producing goods of superior quality and greater aesthetic appeal.

Challenge: Risk of equipment failure and delays in the learning curve of growers

The high risk of equipment failure and the resultant possibility of limited production is hindering the adoption of greenhouse farming. For instance, failure of a part of the system, such as a water pump, may lead to the death of the plants within a matter of hours. Without soil, there is no water or nutrient storage for plants to feed on. Much like any typical grow room, in case of a power outage, the backup must be ready. This might result in additional costs, consequently affecting the cost of production and profit margins.

The delay in the learning curve of users also acts as a challenging factor in the growth of this market. For a large portion of the population that is accustomed to traditional ways and farming techniques, it becomes difficult to adopt modern and newer techniques, such as hydroponics. They are required to spend considerable time to understand the systems. Delays in getting familiar with the systems can hamper production. Delayed learning curves among growers thus pose a potential challenge to market growth.

Commercial Greenhouse Market Ecosystem

Leading companies in this market include well-established, financially stable solution providers of commercial greenhouse products and service providers. These companies have been operating in the market for several years and possess a diversified service portfolio, state-of-the-art laboratory & technologies, and strong global sales and marketing networks. Prominent companies in this market include Berry Global Group, Inc (US), Signify Holding (Netherlands), Heliospectra AB (Sweden), PLASTIKA KRITIS S.A. (Greece), EVERLIGHT ELECTRONICS CO., LTD (Taiwan), Prospiant (US), RICHEL GROUP (France), Argus Control Systems Limited (Canada), Certhon (Netherlands), LOGIQS.B.V. (Netherlands), Lumigrow, Inc (Canada), Agra Tech, Inc (US), Hort Americas (US), Top Greenhouses (Israel), and Stuppy Greenhouse (US).

Within the greenhouse type segment, plastic greenhouse is projected to have the highest market growth rate during the forecast period.

Alternatives to conventional glass structures that are more affordable include plastic greenhouses. Plastic greenhouses often have cheaper construction costs and material costs, making them more affordable for a wider range of producers, including small and medium-sized businesses. This accessibility promotes broader market adoption and expansion.

Furthermore, greenhouses made of plastic have great insulating capabilities. They can hold onto heat more effectively than glass buildings, which results in energy savings while controlling temperature. This thermal efficiency helps maintain favorable growing conditions and lowers the running costs for heating and cooling. Thus, such factors contribute to the growth of the market, and the plastic greenhouse category is the fastest-growing segment in the type segment. It is expected to propel the market growth further.

Within the equipment segment, hardware is predicted to have the largest market value during the forecast period.

The hardware segment is predicted to have the largest market value in the commercial greenhouse segment due to its fundamental role in establishing and maintaining greenhouse structures. Typically, the hardware components are made to survive environmental obstacles, including wind, snow, rain, and freezing temperatures. High-quality hardware components also protect the greenhouse structure's durability and dependability, decreasing the need for frequent repairs or replacements and helping greenhouse operators save money overall. Moreover, the expansion of commercial greenhouse farming into regions with varying climates and agricultural practices creates a demand for adaptable and reliable hardware solutions.

Within the crop-type segment, vegetables are anticipated to have the leading market share during the forecast period.

Greenhouse environments enable precise control over factors such as temperature, humidity, light, and nutrients. This level of control enhances crop growth, leading to higher yields and superior-quality produce. Consumers are increasingly seeking nutritious and visually appealing vegetables, which are more reliably achieved within greenhouse farming techniques. Since vegetables are utilized across the majority of dishes and are considered a staple food across the world, thus there is a never decreasing demand for vegetables, which is expected to drive the market of commercial greenhouses in the upcoming years.

Europe is expected to have the largest market share during the forecast period.

Due to urbanization and other land-use pressures, certain European countries have a limited amount of arable land accessible. Commercial greenhouses, therefore, offer an effective approach to maximize food production in a constrained location, making them a workable answer to the problem of food security. European institutions, universities, and research organizations are at the forefront of agricultural research and innovation. This has led to the development of advanced greenhouse technologies, cultivation practices, and crop varieties that enhance productivity and sustainability. Moreover, the developed commercial greenhouse sector in Europe enables surplus output that may be exported to other regions, which helps the area dominate the market.

Key Market Players

The key players in this market include Berry Global Group, Inc (US), Signify Holding (Netherlands), Heliospectra AB (Sweden), PLASTIKA KRITIS S.A. (Greece), EVERLIGHT ELECTRONICS CO., LTD (Taiwan), Prospiant (US), RICHEL GROUP (France), Argus Control Systems Limited (Canada), Certhon (Netherlands), LOGIQS.B.V. (Netherlands), Lumigrow, Inc (Canada), Agra Tech, Inc (US), Hort Americas (US), Top Greenhouses (Israel), Stuppy Greenhouse (US). These companies have been focusing on expanding their market presence, enhancing their solutions, and partnering with many channel partners and technology companies to cater to consumers across the globe. The deep roots of these players in the market and their robust offerings are among the major factors that have helped them achieve major sales and revenues in the global commercial greenhouse market.

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Scope of the Report

This research report categorizes the commercial greenhouse market based on type, equipment, crop type, and region.

Based on type, the commercial greenhouse market has been segmented as follows:

• Glass Greenhouse
• Plastic Greenhouse

Based on the equipment, the commercial greenhouse market has been segmented as follows:

• Hardware
• Software & services

Based on the crop type, the commercial greenhouse market has been segmented as follows:

• Fruits
• Vegetables
• Flowers & Ornamentals
• Nursery Crops
• Other Crop Types

Based on the region, the commercial greenhouse market has been segmented as follows:

• North America
• Europe
• Asia Pacific
• South America
• RoW (the Middle East & Africa)

Recent Developments

• In August 2023, Certhon (Netherlands) acquired DENSO (Japan), which helped Certhon to accelerate the global expansion of its agricultural production business by leveraging Certhon's advanced horticultural technologies to develop innovative farm models, address food challenges, and enhance the agricultural value chain.
• In May 2022, Signify Holding (India) acquired the rights of Fluence (US). This acquisition allowed Signify Holding to expand its product offering in indoor farming lighting solutions that help Signify’s position n in the attractive North American horticulture lighting market.
• In May 2021, Heliospectra AB (Sweden) partnered with Harahara Inc. (Japan). The partnership enabled Heliospectra AB to sell it to bring light automation to the Japanese market, thereby expanding its geographical presence. The partnership is expected to augment Heliospectra AB's long-term growth strategy in new geographies across the Japanese market.
• In December 2020, Prospiant (US) acquired Sunfig Corporation (US), which helps Prospiant by providing software solutions to the market Sunfig Corporation is a provider of software solutions that optimize solar energy investments through upstream design, performance, and financial modeling.

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